The Unstoppable Debt Domino
This handy guide from MoneySmart outlines three specific actions which you can accomplish right away to start managing your debt. The first step, which will take approximately 60 seconds, is to check your credit score and assess your total debt, and how you have been paying them.
The second step, for the next 60 minutes is to gather information you will need to negotiate lower terms with your credit card company or bank.
The third step to be done for the next six days is to list down all your debts from smallest to largest. You might find this easier than arranging them by interest rate. Keep paying the minimum payments each month on all other bills except the smallest loan, then “throw everything you have” at this debt until it has been paid off. Once it has been paid off, cut up the credit card or have a bill-burning celebration. It’s important to give yourself a pat at the back for each milestone. Then do the same for the next smallest loan.
Implementing this system can feel very fulfilling every time you finish off a debt, and will motivate you to work harder until you are completely debt free.
For more information on the debt domino, click here.